Thursday 13th June 2019

OPENING CALL: The Australian share market is expected to open higher. The SPI200 futures contract was up 2 points.

U.S. consumer prices inched up in May, held down by a decline in energy prices.


Gasoline prices post a decline, after three months of strong increases.

Overnight Summary

Market Quotes by TradingView

Each Market In Focus

Australian Market

Australian stocks pulled back late after spending all day in positive territory amid a
decline for many in Asia Pacific. After notching another 11 1/2-year intraday high, the
ASX 200 ended down 2.6 points at 6543.7, the day’s low.
Health care pulled back 1.7% and financials shed 0.7%. But materials jumped 2.1%,
hitting fresh 8-year highs, as iron-ore prices continue to reverse their recent retreat.
Telecom rose 0.5% to post its own 17-month best. Meanwhile, as consumer-discretionary
stocks lost 0.65%, staples gained 0.4%.

US Markets

U.S. stocks extended their losses intraday, a day after snapping a weeklong winning
streak amid lingering trade tensions and questions over the direction of Federal Reserve
The Dow Jones Industrial Average fell 52 points, or 0.2%, to 25996. The S&P 500 lost
0.2% and the technology-heavy Nasdaq Composite lost 0.4%.
U.S. equity markets have eased over the past two sessions after rising sharply the
prior week after Federal Reserve officials hinted that the central bank might lower
interest rates at its meeting next week to offset the negative effects of trade disputes.

Yields on short-term U.S. government bonds fell after another set of tame inflation
data bolstered investors’ expectations that the Federal Reserve will soon move to cut
interest rates.
The yield on the two-year Treasury note, which is particularly sensitive to changes in
monetary policy, settled at 1.891%, according to Tradeweb, compared with 1.922% Tuesday.
The yield on the 10-year note also slipped, falling to 2.129% from 2.140%.
Yields, which fall when bond prices rise, declined after the Labor Department said
consumer prices excluding volatile food and energy products rose just 0.1% in May from
the previous month.


Gold futures finished higher, their 10th gain out of 11 sessions.
Declines in global stock markets and worsening U.S.-China trade tensions provided
support for the haven metal.
August gold added $5.60, or 0.4%, to settle at $1,336.80 an ounce. That was highest
finish since Friday, according to FactSet data.
Prices had posted eight consecutive session gains before settling lower on Monday and
ending higher Tuesday.

Oil Futures

Oil prices dropped sharply as data showing inventories rose last week reinforced
concerns over slowing global demand.
West Texas Intermediate futures fell 4% to $51.14 a barrel on the New York Mercantile
Exchange, the lowest settlement level since January. Brent crude, the global benchmark,
was down 3.7% at $59.97 a barrel on London’s ICE Futures exchange, a 19-week low.
U.S. crude-oil stockpiles rose by 2.2 million last week, data from the U.S. Energy
Information Administration showed Wednesday. Analysts and traders surveyed by the Journal
expected stockpiles to fall by 600,000 barrels. Prices were already lower before
Wednesday’s report and extended their losses into the close.
Worries over slowing global growth have weighed on crude prices in recent weeks, stoked
by an escalated trade conflict between the U.S. and China that investors increasingly
believe will hurt demand for oil and other raw materials.
Brent crude is down nearly 20% from its April high, putting it within striking distance
of a bear market. WTI futures are down roughly 17% in the past month.


The WSJ Dollar Index, which tracks the dollar against a basket of 16 currencies, was
slightly higher in late trading.
U.S. consumer prices inched up in May, held down by a decline in energy prices. The
consumer-price index, which measures what Americans pay for household goods and services
such as toys or electricity, rose a seasonally adjusted 0.1% in May from the previous
month, the Labor Department said Wednesday. Excluding volatile food and energy prices,
costs were also up 0.1% on the month.

European Markets

Italy’s FTSE MIB was the big loser, closing 0.7% lower, while France’s CAC 40 ended the
day down 0.6%, Spain’s IBEX 35 closed 0.5% lower and Germany’s DAX was off by 0.3%, as
was the STOXX Europe 600.

Asian Markets

China’s Shanghai Stock Exchange dropped 0.6%, Korea’s Kospi fell 0.1% and Japan’s
Nikkei 225 fell 0.4%.
Hong Kong’s Hang Seng was the region’s worst performer, dropping 1.7% as protesters
blocked access to the legislature, forcing lawmakers to postpone debate on an unpopular
bill that would allow people to be extradited to China.
Property developers led the declines in Hong Kong after Chinese developer Goldin
Financial on Tuesday pulled its $1.4 billion winning bid to redevelop a former airport,
citing “social contradiction and economic instability.”
The property subindex of the Hang Seng fell 2.8% and major builders such as Sun Hung
Kai and Henderson Land dropped between 2% and 3%.
Indian shares too ended lower in line with other Asian markets Wednesday, ending its
3-day winning streak. The BSE Sensex closed 0.5% lower 39756.81 with banking and
automobile stocks weighing.
Indonesian stocks fell more than others in Southeast Asia Wednesday, ending a
four-trading-day winning streak. The Jakarta Composite Index hit session lows ahead of
the close and ended 0.5% lower at 6276.18.

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